The original version of Nudge was published in the spring of 2008. While we were writing it, Thaler got his first iPhone and Sunstein his first BlackBerry. In his first term as a United States senator, our former University of Chicago colleague Barack Obama had decided to challenge Hillary Clinton for the Democratic nomination for president. Senator Joe Biden was also doing that, without a whole lot of success. Real estate developer and reality television star Donald Trump was proclaiming that Clinton was “fantastic” and would “make a great president.” A financial crisis was emerging. Taylor Swift was nineteen years old (and had not yet won a Grammy), and Greta Thunberg was just five.
To say the least, a few things have happened in the intervening years. But Nudge continues to attract interest, and we have not been much inclined to tinker with it. Why a revision now? As we discuss in the book, status quo bias is a strong force.
Very much in keeping with the book’s spirit, we were induced to emerge from our slumber by a seemingly small matter. The contracts for the American and British paperback editions had expired, and new ones had to be agreed upon. Editors asked whether we might want to add a new chapter or possibly make other changes. Our immediate reaction was to say no. After all, Thaler is famously lazy and Sunstein could have written an entirely new book in the time it would take to get the slow‑fingered Thaler to agree to anything. Besides, we were proud of the book, and why mess with a good thing?
But then we started thumbing through copies we managed to find in our home offices, where we found ourselves during the year of COVID‑19. The first chapter mentions the then‑snazzy but now‑obsolete iPod. Jeez, that seems a bit dated. And an entire chapter is devoted to what we still think was an excellent solution to the problem of making it possible for same‑sex couples to marry. Since then, many countries somehow managed to solve that very problem in a way we had not imagined was politically possible. They just passed laws making such marriages legal. So, yeah, maybe some parts of the book could use a bit of tidying up.
So, it came to pass that in the summer of 2020, a summer like no other in our lifetimes, we decided to poke around the manuscript and see if we wanted to make some changes. It helped that Thaler managed to find a set of Microsoft Word files that had been used for what we called the international edition, and those files were (barely) usable. Without those files, this edition would not exist, because we would never have wanted to start over from scratch. We admit to then falling into a bit of a trap. We are supposedly experts on biases in human decision making, but that definitely does not mean we are immune to them! Just the opposite.
We are not sure that this particular trap has a name, but it is familiar to everyone. Let’s call it the “while we are at it” bias. Home improvement projects are often settings where this bias is observed. A family decides that after twenty years of neglect, the kitchen really needs to be upgraded. The initial to‑do list includes new appliances and cabinets, but of course, the floor will be ruined during the construction, so we’d better replace that, and gosh, if we just pushed that wall out a bit, we could add a new window, which looks out on the patio, but oh dear, who wants to look at that patio . . . In the military this is called mission creep. Here we plead guilty to book revision creep. The revision that we planned to knock off during the summer was not given to the publisher until late November.
We have added a new chapter on what we call sludge, which is nasty stuff that makes it more difficult to make wise choices . . . Every organization should create a seek‑and‑destroy mission for unnecessary sludge.
However, to continue the home remodeling analogy, in spite of our slow pace, what we have here is definitely not a gut rehab. The book feels very much like the old one. All the walls remain, and we have not expanded the footprint. But we have gotten rid of a bunch of old pieces of electronics that have been collecting dust and replaced them with newer gadgets.
More specifically, the first four chapters of the book have not much changed. They set out the basic framework of our approach, including the term libertarian paternalism, which only its authors love. Examples and references are updated, but the songs remain the same. If it were a record album, we would call this section “remastered,” whatever that means. If you have read the original edition, you can probably skim those chapters pretty quickly. After that, however, even previous readers will find many new themes, and perhaps some surprises.
Two important topics are given new chapters early on. The first is what we call Smart Disclosure. The idea is that governments should consider the radical thought of moving at least into the twentieth century in the way they disclose important information. Sure, listing ingredients on the side of food packages is useful, especially for those with very good eyesight, but shouldn’t Sunstein be able to search online for foods that contain shellfish, given that they can make him very sick? The Internet is not exactly a cutting‑edge technology. Widespread use of Smart Disclosure would make it possible to create online decision‑making tools that we call choice engines, which can make many tasks as easy as it has become to find the best route to get to a new restaurant.
We have also added a new chapter on what we call sludge, which is nasty stuff that makes it more difficult to make wise choices. (Sludge is everywhere; you’ll see.) The use of Smart Disclosure is one way to reduce sludge. So is sending everyone a tax return that has already been completed and can be filed with one click. So is reducing the length of those forms you have to fill out to get licenses, permits, visas, health care, or financial aid, or to get reimbursed for a trip you take for your employer. Every organization should create a seek‑and‑destroy mission for unnecessary sludge.
The rest of the book also has numerous substantive changes and what we hope is fresh thinking. We introduce several choice architecture concepts, in addition to “sludge,” that are new to this edition. These include personalized defaults; make it fun; and curation. These concepts play a large role in the chapters about financial decision making. We have increased the space we devote to climate change and the environment. We highlight both the limits of choice architecture (preview: we can’t solve the problem just with nudges) and the many ways in which nudges can help us succeed on a project that demands the deployment of every possible tool. And, oh, we do have a few things to say about the COVID‑19 pandemic.
Some topics that we originally covered get a fresh look. The passage of years has created the chance to evaluate how policies work over time. A good example is the Swedish launch (in 2000) of a national retirement savings program, which allowed investors to create their own portfolios. In the original edition, we discussed the initial design of that plan. Now, two decades after the launch, we can provide some insights about how long nudges last. (Preview: some of them can last almost forever.) We have also rewritten the chapter on organ donation, because everyone thought we supported a policy we actually oppose. We did state our policy in what we thought was plain language in the first version of the book, and we tried to make it a bit clearer in the paperback editions. But still our message wasn’t getting through, so we are trying once again. In case this is as far as you get in the book, please take note: we do not support the policy called “presumed consent.” Feel free to skip ahead to see why. We really do believe in freedom of choice.
We have also rewritten the chapter on organ donation, because everyone thought we supported a policy we actually oppose. In case this is as far as you get . . . please take note: we do not support the policy called “presumed consent.”
Other topics with fresh looks are devoted to helping consumers make better choices with their money. People have amassed staggering amounts of credit card debt, and then fail to take some simple steps to reduce the costs of maintaining those large balances. Consumers also make demonstrably bad choices in picking mortgages, insurance, and health care plans. You may well be one of the people who could save a lot of money in these domains. But more importantly, we hope that our discussion of these issues will provoke others to make behaviorally informed policy changes in an assortment of domains that we have not explored. We emphasize that the concepts and approaches discussed here are fully applicable to the private sector. Firms should explicitly recognize that their employees and customers and competitors are human beings, and design policies and strategies accordingly. We will offer many specific ideas for how to do this.
It is important to stress what we have not done. We make no attempt to bring readers up to date on the remarkable nudge‑related activity, reform, and research that have come about in recent years. Governments all over the world have been nudging, often for good, and the private sector has also been exceptionally inventive. Academic research has grown by leaps and bounds. To explore these developments would take an entirely new book, and in fact many such books have been written, some even by Sunstein. Indeed, Sunstein has coedited a four‑volume collection of papers on this topic. (Sunstein thinks editing a four‑volume collection of papers on the topic of nudging is fun; Thaler would rather be counting backward from ten million.)
We have some things to say about objections to nudges, and in fact we devote a whole chapter to that topic, but we do not respond systematically to critics. What we hope to offer is a book that will feel fresher, more fun, and less dusty to those reading it for the first time, or even to those returning for another look, as we have spent the past months doing ourselves.
Finally, a word about our decision to call this version of the book the Final Edition. One of the earliest topics to be studied by behavioral economists was self‑control problems. Why do people continue to do things they think are dumb (both in foresight and in hindsight)? These include acts such as running up credit card bills, getting more than a bit chubby, and continuing to smoke. One strategy people use to deal with such problems is to adopt commitment strategies, in which some tempting (but ill‑advised) options are made unavailable. For example, some people with a gambling problem volunteer to put their name on a list of people who will not be allowed into a casino. Using this title is our commitment strategy to prevent us from ever tinkering with this book again. We have loved working on it, and we might even have gotten addicted to it, but we pledge, right here and right now, that there will be no “post‑final” edition of Nudge. And one of us actually believes that pledge.
From NUDGE by Richard H. Thaler and Cass R. Sunstein, published by Penguin Books, an imprint of Penguin Publishing Group, a division of Penguin Random House, LLC. Copyright © 2008, 2009, 2021 by Richard H. Thaler and Cass R. Sunstein.
Disclosure: Richard Thaler serves on the governing board of the Center for Decision Research at the University of Chicago Booth School of Business, which previously provided financial support to Behavioral Scientist.